Chennai: Madras High Court has said religious institutions would certainly fall within the definition of "establishment," as defined in the Payment of Gratuity Act.
A Full Bench of the Court said that going by the principle laid down by the Supreme Court on various decisions, management could not have any more doubt with regard to payment of gratuity and pension.
The Full Bench, comprising Justices Elipe Dharma Rao, D Murugesan and M Venugopal stated this while examining a case on whether a "religious institution/temple would come within the purview of Section 1(3)(b) of the Payment of Gratuity Act.
Earlier, the matter was referred to a Full Bench in view of conflicting decisions rendered by two Division Benches of the High Court.
A Division Bench had upheld a single Judge`s order in an earlier case that Section 1 (3) of the Payment of Gratuity Act did not apply at all to religious institutions and its employees were not entitled to claim gratuity.
Justice Rao said a reading of decisions of the single judge and Division Bench would show neither the Apex Court decisions or that of other High Courts or Madras High Court had been relied on to conclude that a religious institution did not come under the purview of the Payment of Gratuity Act.
The Apex Court had laid down that Sec 1(3)(b) could apply even to non-commercial establishments and its various other decisions would only pave the way to conclude that "religious institutions" would also be attracted by the term "establishment" under the Payment of Gratuity Act.
It would not stop within the meaning prescribed to "establishment" under the Tamil Nadu Shops and Establishments Act, the Full Bench added.